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Culture Change: a D Iscussion Document CULTURE CHANGE: A DISCUSSION DOCUMENT BY ANDREA (ANDI) SIMON, PH.D. CORPORATE ANTHROPOLOGIST | CEO SIMON ASSOCIATES MANAGEMENT CONSULTANTS “Culture Change: A Discussion Document” is for anyone who is interested in how to assess their current culture for their organization, regardless of what type of organization it is, and how to better understand what that organization's employees would really prefer that culture to become. There are lots of reasons why this is so important. At SAMC, we use a tool called the Organizational Culture Assessment Instrument (OCAI). I want to talk today in this power point presentation about how the OCAI works, why you should think about using it, and then once you have, how to change your organization's culture based upon the results you see. At SAMC, when we’re hired to help an organization change, the first question we often get, and typically it's from an HR person or an organizational development person, goes like this: "We have a new CEO (or president or new executive) and they really want to better understand the culture we have today, and then they want to create one that is far more ……" and you can fill in the blank. We've heard all kinds of things. The new leader wants to have more rules, more results. They want more customer focus. They'd like to have more entrepreneurial spirit. They 1 want to empower their employees. Maybe they want more teamwork. The words are varied but by and large, they really don't know what their company culture is today, nor what it should become for the future. Culture is extremely important. Culture is the essence of who people are. They come together to share common values, beliefs and behaviors. So when we start talking about culture change, it's important to know, "What is your culture today, anyway?" You've been recruiting for it. You've brought in people who fit it. The people who have stayed, like it. They value the same kinds of things that their colleagues do. They know what to talk about at lunch. So, the idea of changing it isn't casual. It's serious. And what will you change it to? What are the dimensions of it? Will the new culture actually get the results your strategy is designed to achieve? A much-quoted phrase says that “culture eats strategy for breakfast, lunch, and dinner.” It’s true. Culture really does overwhelm whatever your strategy is because if it is not aligned with the values, beliefs and behaviors of your people, it will not work. So what kind of culture change process will stick? This is part of the reason why the OCAI has become so popular and valuable. Change programs often fail. In fact, as many as 75% of company efforts to change fail entirely or create negative results. McKinsey did excellent research on this, and they found that 70% of company efforts to change went nowhere, and as soon as the effort was completed, people went back to what they had always done. So regardless of what they were doing, Fortune 500 companies found only 20% achieved their quality objectives. 40% said they were a complete flop. Whether it's reengineering or TQM (total quality management), even strategic plans have become shelfware, downsizing. It's very difficult to change people and people are your organization. I love Tony Robbins’ quote: "Change happens when the pain of staying the same is greater than the pain of change." Think about it. At SAMC we often say, "If you want to change, have a crisis or create one." People hate to change, even when they know that they have to in some way. Even if they know there are generational differences. It doesn't quite matter what the reason is for thinking about culture change. It's only when the pain becomes quite profound that people really pay attention. You need a fire drill and an emergency room. What is culture anyhow? In the very simplest definition, culture is the way you think, act and interact. Humans are cultural animals. We give meaning to everything, and we don't live alone. For us to interact with others, we need to share common values, stories, beliefs and ways of doing things. We don't want to think about it each and every time. Culture is a habit that takes over. Successful firms have intentionally built cultures. Now, humans are very clever and creative creatures. If you don't build a culture, people will build one for themselves. They cannot live without it. It's part of who they are as humans. It's the essence of who they are. And if they come into a company and they're aggressive and competitive, and they want to win, they'll build a culture around those 2 things that they value. And if they are very much into entrepreneurship, and they like visionary ideas, they are going to do that too. Successful firms reduce uncertainties and create a social order so that people know what to expect. That expectation is extremely important. People come to work every day, and they want to know what to expect. Culture also creates continuity and key values and norms. Think about your onboarding process. You're trying to share with somebody new what you value, what you believe in and the way you get things done. Culture also creates a collective identity and a commitment to that identity. It becomes the brand. And if you have a good strong brand, you want to make sure you're living it. Living it is that culture. It expresses a vision of the future and energizes forward movement. People need to know where they're going, and they can only follow you if they have a clear understanding of what this means for them. Now, this is all fine, as long as it's not the wrong culture. And the wrong culture can take you down the wrong path, and you won't even know it until it's too late. Once organizations have a culture, that culture hates to change. The reason that it's so powerful is that humans have evolved because they've had cultures that are shared from one generation to the next, from one group of employees to the coming of the new ones. And that consistency has made it very powerful as a vehicle for our survival. So these values, beliefs and behaviors are “the way we do things here.” And even if they're not working, and you know they're not working. The continuity of those cultural values is very powerful. And in the process, adherence to a clear set of conceptual values makes it very difficult for us to say, "Well, those were good in the past, but now we want them to change to something new." We haven't quite figured out what those are yet. Cultures can foster adaptability, so on the one hand, I've been talking about how they create consistency and continuity. But there also can be cultures that foster adaptability, innovation and value creation, but they do it by providing a clear set of principles to follow when designing strategies to deal with new situations. Innovative companies know how to do innovation. They build a culture of idea generation, of methods for testing prototypes. They understand what the return on that investment should be. And they really have processes to engage staff around new methods of doing things. So it's not simply a hardcore sort of casual. Innovative cultures are extremely well designed to do innovation. In addition to that, departments within an organization may have their own subcultures. And I'm sure you're seeing that. In your own organization, Marketing may have very different values than Sales or Human Resources, Engineering or Finance. It is very interesting that the line organization often is disconnected from the support staff. Systems engineers act differently than those who are implementing those systems. We had one wonderful client situation where the system engineers thought all the clients were really stupid. That was very interesting. Not a good alignment at all with what the clients needed. And in many ways, they didn't even know what the clients needed. 3 So you can have different companies with a different focus on what you value and how you act. And you can have different departments who may as well. And all of that can work well if there's a shared culture across the organization, such as, “We belong to this firm and share common things. So when we are asked, ‘Why do you like working there,’ we can tell them why.” Culture is a glue. I can't emphasize that enough. The story that you create in that culture is the glue that holds it together. It's an ideology and worldview. But it's basically a story. It may be a mythology, but it's a story that we share. And it affects the way your team members think, feel and behave. It’s very true that we decide with the heart and justify with the head. People are not aware of their culture until it's challenged, or maybe when they experience a new one. There are often situations which our clients have where somebody leaves the firm to go somewhere else and then calls a year later and says, "Can I come back? I've experienced a new company culture and I don't like it at all." So until you go and visit a different place and live in it, you may not know what your culture is and why one is better than another.
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